Employee relations at Steve's Music hit a sour note

Exteriors of Steve's Music store located on Queen St. West (Fred Lum/The Globe and Mail/Fred Lum/The Globe and Mail)

When Steve's Music fired Shelley Altman two years ago, she probably wondered if she had the strength to fight back.

After all, Ms. Altman was 57 years old and dying of lung cancer. She had no husband, no children, no deep financial pockets and was undergoing rigorous rounds of treatment.

Ms. Altman gathered what energy she had and did hit back. She sued the company for wrongful dismissal, pushing so hard that when doctors told her she had six months to live, she asked to have the trial date moved up so she would be around for the ruling.

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The decision came out last month and Ms. Altman won a sweeping victory. The judge awarded her 22 months salary, a host of other payments and tacked on $55,000 in "moral" and punitive damages, bringing the total above $200,000. Steve's isn't appealing and a company official declined comment.

In a ruling delivered with an extraordinarily castigating tone, Madam Justice Katherine Corrick sent a strong message to companies about how they treat employees who are fighting serious illness but can still do some work. Experts say the ruling will make it harder for companies to quietly push these employees out the door.

"Workplace issues are huge problems for cancer patients," said Madeline Li, a Toronto psychiatrist who specializes in cancer patients and treated Ms. Altman. "It's true with any medical illness. You can't discriminate based on an illness." She added that "most cancer patients don't have the wherewithal to take action like this. I'm amazed that she did."

The dedicated employee

Shelley Altman's introduction to Steve's Music came nearly 40 years ago when she met company founder Steve Kirman in Montreal. Ms. Altman was a singer at the time and she was looking for a new sound system. Her band mate and future husband, Gerry Markman, suggested she check out Mr. Kirman's store.

In 1977, Mr. Kirman decided to open a new store in Toronto and he asked Mr. Markman to help get it started. By the end of the first week, the store was so busy, Mr. Markman frantically called Ms. Altman, then his wife, to help out.

Ms. Altman and Mr. Markman later divorced, but Ms. Altman stayed at Steve's.

She did just about everything at the store, working behind the counter, handling accounting, managing the office and eventually becoming manager in 1998. She also got involved with an industry association and took pride in being one of the few women to run a music store in Canada. Steve's grew quickly and added another store in Ottawa, making it one of the most successful chains in Canada. It became a fixture for novices as well as superstars like Stevie Wonder, who, during a concert stop in Toronto, needed a harmonica and had one delivered by Ms. Altman.

But it was her close relationship with Mr. Kirman and his family that kept Ms. Altman at Steve's. Mr. Kirman's son, Michael, ran most of the day-to-day operations, and other Kirman family members worked at Steve's as well, including Mr. Kirman's brother and daughter. Ms. Altman felt part of the family and attended the wedding of Mr. Kirman's daughter.

"There is a loyalty that Steve has to his employees and I think it says a lot about Steve," Ms. Altman once told a trade magazine. "You can tell I'm very proud."

Everything changed for Ms. Altman, a smoker, in November, 2007, when she went for a routine medical test and doctors found a tumour in her lung. She had an operation three months later to remove much of the lung, but by then doctors confirmed she had cancer.

Ms. Altman began rounds of radiation and chemotherapy. Through it all, she kept working at Steve's, juggling her duties around treatments and appointments.

Everyone at Steve's, including the Kirmans, knew about Ms. Altman's struggle with cancer and initially expressed support. According to court filings, Michael Kirman didn't question her need to cut back on work to recover from treatments and he told her to get better before resuming full-time duties. Steve Kirman suggested she consider disability insurance but Ms. Altman said she was determined to keep working, according to filings.

The dismissal

On Oct. 15, 2008, Ms. Altman discovered the company's attitude had changed. She was at home recovering from treatment when she received a letter delivered by a bailiff. It was from a law firm representing Steve's. The message was blunt. "It appears that you have been remiss in your duties and obligations towards Steve's Music in failing to work minimum number of hours required by your employer from Monday to Friday," the letter said. It added that unless Ms. Altman started working full time, she would be fired.

Ms. Altman was crushed. "It was very clear to me that, for her, receiving that bailiff's letter was more traumatizing than the cancer diagnosis itself," said Dr. Li. "She had such loyalty to them and her whole identity was caught up with being a Steve's employee and an exemplary Steve's employee."

Ms. Altman's doctors ordered her to take a medical leave, which ran for six months and was unpaid. When it ended in April, 2009, she contacted Steve's about returning to work. The company sent another letter from its lawyers, this time saying her job had been "abolished." Furthermore, Ms. Altman would get no severance because, according to the letter, any money owed to her was being offset by her "absenteeism, late arrivals and early departures."

Ms. Altman sued for more than $700,000 in damages. The case dragged on for months but sped up when Ms. Altman's doctors told her she wouldn't last to the end of February, 2011. A five-day trial started in late January.

The trial

During the trial, lawyers for Steve's argued Ms. Altman's cancer had made her permanently disabled and incapable of performing her duties. They noted that she applied for long-term disability benefits, an indication she considered herself to be disabled. And they argued she received all compensation owed.

Michael Kirman told the judge the termination letter had been insensitive and inappropriate, according to court filings. However, he said it was an aberration and not consistent with the way the company treated Ms. Altman when she first became sick. Steve's had no employment policy manual, he added, and employee issues had been developed over time by Mr. Kirman. "Steve's Music Store has been for many years Steve's. He's the guiding light. He's the boss," the company's lawyers argued, according to filings.

Ms. Altman's lawyers argued the company's dismissal of Ms. Altman was heartless and illegal. They pointed out that no one at Steve's raised objections about her work or suggested her job was at risk until Oct. 15, 2008. None of Ms. Altman's doctors said her treatments left her permanently incapable of working, they added, and applying for disability benefits was irrelevant because those benefits are often paid to people who eventually return for even part time work.

The decision

Justice Corrick sided with Ms. Altman. She dismissed Steve's arguments and said Michael Kirman lacked credibility. Ms. Altman was able to perform some of her duties, the judge ruled, and her doctors had encouraged her to return to work when possible. The judge cited court decisions outlining the factors companies must consider before deciding an illness is permanent. They include the nature of the job, the length of employment and the duration of the illness.

"I conclude that once Steve's decided that Ms. Altman had become more of a liability than an asset to the organization because of her cancer, they abandoned her to be dealt with by their lawyers," the judge wrote.

The judge also cited several breaches of employment law by Steve's which prompted her to add punitive and moral damages. Ordering compensation and severance payments alone was not enough, the judge said, "to avoid a repetition of this conduct or to express the court's repugnance at the conduct."

The ruling has rippled across legal circles and the music industry. "I'm a little surprised at this case," said Al Kowalenko, a former long-time executive director of MIAC. "I didn't think that type of thing would happen with these guys."

Dr. Li hailed the decision as an important victory. "The trial was for her never about the money or getting back at Steve's," she said. "It was about correcting a wrong."

Ms. Altman's cancer has spread to her brain and bones, leaving her largely housebound. She gets tired just talking on the phone. In a brief conversation, she declined to discuss details of the case, since some issues still have to be sorted out by the judge. But she added in a later e-mail: "I do have a goal after all this to work with people and the government."